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CHARLOTTE, N.C.--(BUSINESS WIRE)--As millennial Americans have experienced the effects of the Great
Recession of 2008, a strong majority (80%) say it has taught them they
have to save “now” to “survive” economic problems down the road. Despite
this generation's reported lesson, 45 percent are not saving for
retirement, while slightly more than half (55%) are saving. The savings
picture varies by gender with 61 percent of men and 50 percent of women
reporting that they are saving. This difference in saving rates may
hinge on the fact that the median annual household income reported by
millennial men is $77,000 versus $56,000 for women. For college-educated
millennials, median annual household income is reported to be $83,000
for men and $63,000 for women. About half of all millennials report they
are “satisfied” with their savings at this point in their lives, but the
gender discrepancy is pronounced, with 58 percent of men feeling
satisfied, versus 41 percent of women. These findings are part of the
2014 Wells Fargo Millennial Study, conducted online by Harris Poll on
behalf of Wells Fargo, released today at a Women’s
Institute For A Secure Retirement (WISER®) forum in Washington, DC.
The survey was conducted among over 1,600 U.S. adults aged 22-33
(“millennials”), and among over 1,500 U.S. adults aged 49-59 (“baby
boomers”).

“The silver lining of the recession that started over five years ago is
that a majority of millennials get that saving is a necessity and
even equate it with ‘surviving’ tough times. But millennial women are
starting out their working lives making far less than men and, as a
consequence, are saving less and feeling less contentment at the start
of their working lives,” said Karen Wimbish, director of Retail
Retirement at Wells Fargo.

The Pressure of Debt

Millennials are struggling under the pressure of debt, with 42 percent
saying "it is their biggest financial concern currently.” Four in ten
say their debt is "overwhelming" versus 23 percent of baby boomers.
Forty-five percent of millennial women feel “overwhelmed” by debt,
versus 33 percent of millennial men. Perhaps due to big debt
obligations, over half of the millennials (56%) say they are “living
paycheck to paycheck,” regardless of gender.

What Kind of Debt?

When asked to rank their number one financial concern after paying
day-to-day bills, millennials cite paying off student loans (29%) as
their top concern, whereas boomers cite saving for retirement (44%).
When asked to estimate certain categories of debt as a percentage of
monthly pay, millennials report their debt breaks down, on average, as
follows: credit card debt, 16 percent; mortgage debt, 15 percent;
student loan debt, 12 percent; auto debt, 9 percent; and medical debt, 5
percent. Among all millennials, 47 percent are allocating 50 percent or
more of their paychecks to these types of debt.

“People have to closely examine what they are spending their money on
and figure out the best way to comfortably manage debt and savings
levels,” said Wimbish.

Retirement and Saving

The progress in accumulating investable assets proves to be another area
of difference between the genders, with college-educated millennial men
reporting median household investable assets of $58,500 and
college-educated millennial women reporting median household investable
assets of $31,400.

Of those millennials who have started saving, almost half (46%)
are saving between 1-5 percent of their income for retirement; 31
percent are saving 6-10 percent; 18 percent are saving more than 10
percent. The percentage of income saved by men and women greatly varies,
with half of women (53%) saving between 1-5 percent versus 39 percent of
men. The percentages of men and women who are saving at the 6-10 percent
level are both about a third; however, over a quarter of millennial men
(26%) are saving at a rate greater than 10 percent versus only 9 percent
of women.

Seven in ten (72%) millennials are confident they will be able to save
enough to create the lifestyle they want in the future, but millennial
women are far less confident than their male counterparts, with 63
percent expressing confidence versus 80 percent of men.

Of the four in ten millennials who are not saving yet, 84 percent say
they are not doing so because they “do not have enough money to save
right now,” with no difference between the genders. Perhaps as a way to
lock down a savings discipline, over half of both boomers (56%) and
millennials (55%) favor a mandatory retirement savings policy.

“Millennial men are earning more, saving greater percentages of their
income and report having more accumulated assets. Women are lagging
behind men in their savings efforts, and this could explain why they
feel less satisfied with their overall financial situation,” added
Wimbish.

Three-quarters of millennials are confident they have the knowledge to
address any financial problems in the next ten years, with 70 percent of
millennial women agreeing with this versus 84 percent of millennial men.
While their confidence is high, when it comes to estimating their
retirement needs, 40 percent of millennials say they have “no idea” what
that amount will be. Nearly a third (31%), say they will need under $1
million while 15 percent say they will need $1 million to $2 million.
For boomers, more than half (54%) say they “can’t estimate” how much
they will need in retirement. Twelve percent say they will need $500,000
to $1 million, and 12 percent say $1 million to $2 million.

Increased Confidence in the Stock Market

Despite the ups and downs of the market, 59 percent of millennials and
66 percent of boomers say the stock market is the best place to invest
for retirement, representing a roughly ten percentage point increase for
both groups from last year’s study. However, the genders view the stock
market differently, with only half of millennial women (49%), and 69
percent of millennial men agreeing that the stock market is the best
place to invest for retirement. A quarter of those millennials saving
for retirement are “not sure” how much of their savings are invested in
stocks or mutual funds. About one in five (18%) millennials currently
saving for retirement say they are invested 100 percent in stocks or
mutual funds, 26 percent say they are in a range of 50 to 75 percent in
stocks or mutual funds. Thirty percent say they are invested 25 percent
or less in stocks or mutual funds.

“I was pleased to see that millennials are warming up to the stock
market, yet concerned to see the huge difference in sentiment among
women, who should be on par with men at this stage,” said Wimbish.
“Still there’s about a third who are underinvested in stocks or all in
cash, and a quarter who aren’t even sure what they’re invested in.
Optimism doesn’t always translate into investing
in the stock market for retirement.”

Millennial Optimism

Millennials feel confident in many aspects of their personal lives, with
seven in ten (69%) saying they feel better off financially than others
in their own generation. In addition, 68 percent of millennials expect
their standard of living before retirement to be better than their
parents.

A majority (84%) of millennials feel they have the skills to succeed in
their career goals when they are 40. More than three quarters (78%)
believe that if they lost their job they could find a comparable one
within a year. This is in sharp contrast to boomers, of whom 58 percent
believe they would be able to find a comparable job within a year.

There is a difference between men and women millennials in the
confidence they feel about building their careers, with one in five
millennial women “worried” about their ability to build a career in
their desired profession versus one in ten millennial men.

The Value of College

Though college debt makes up a big part of the millennial financial
picture, three-quarters (76%) of millennials who attended college agree
that their college education was worth the cost. More than half of
millennials (56%) report relying on student loans to finance college
versus 35 percent of boomers.

A look at the reported median household incomes of those millennials who
attended college and those who did not demonstrates the gap in wages
that not earning a college degree may produce.

Household Income and Assets of College Grads vs. Non-College Grads

CollegeGrad

Non-CollegeGrad

Income (Median)

$72,800

$34,700

Investable Assets (Median)

$43,300

$21,600

Advice to Others Starting Out In Their Careers

Since debt is a top financial concern for most millennials, the most
important financial advice they would impart to someone starting out is:
“Don’t spend more than you earn” (33%), followed by “Get educated about
your personal finances” (17%), and “Start saving for retirement now”
(16%). This contrasts with boomers, 43 percent of whom would tell those
starting out today to start saving for retirement now.

Whom Do They Trust for Financial Advice?

When millennials were asked whom they trust for credible information to
help them make financial decisions, a majority cited “family” (57%),
followed by “financial institutions” (54%) and “personal finance
experts/personalities” (50%). Boomers cite “personal finance
experts/personalities” as their first choice (57%), followed by
“financial institutions” (45%) and then followed by “family” (40%) as
their last choice for financial advice.

While over half of millennials (55%) don’t think they have enough money
to have a financial advisor, 16 percent are using a paid professional,
up from 8 percent a year ago. Similar to last year, 59 percent of
millennials who do not use a paid advisor say they would prefer a
“seasoned advisor” with years of experience, but there was a slight rise
this year (from 20% to 26%) among those who want an advisor closer to
their age, who can potentially better understand their financial
goals.

For help understanding how to prepare for and live in retirement, visit
Wells Fargo’s My
Financial Guide. To find out how much you should be saving for
retirement go to My
Retirement Plan. Visit the Beyond
Today blog to share your financial insight and join the conversation.

About the Survey

The 2014 Wells Fargo Millennial study was conducted online by Harris
Poll on behalf of the Wells Fargo Wealth, Brokerage, and Retirement
(WBR) team between April 15 and May 2, 2014. Survey respondents included
1,639 millennials between the ages of 22 and 33, as well as 1,529 baby
boomers between the ages of 49 and 59. Oversample completes were
collected for millennials and baby boomers in the Charlotte (134
millennials, 151 boomers), Minneapolis (156 millennials, 157 boomers),
Atlanta (157 millennials, 160 boomers) and NYC (150 millennials, 158
boomers) markets. Results were weighted, as needed, to represent the
most recent U.S. Census data based on: age, sex, race/ethnicity,
education, region and household income.

About Nielsen & Harris Poll

On February 3, 2014, Nielsen acquired Harris Interactive and Harris
Poll. Nielsen Holdings N.V. (NYSE: NLSN) is a global information and
measurement company with leading market positions in marketing and
consumer information, television and other media measurement, online
intelligence and mobile measurement. Nielsen has a presence in
approximately 100 countries, with headquarters in New York, USA and
Diemen, the Netherlands. For more information, visit www.nielsen.com.

About Wells Fargo (Twitter @WellsFargo)

Wells Fargo & Company (NYSE: WFC) is a nationwide, diversified,
community-based financial services company with $1.5 trillion in assets.
Founded in 1852 and headquartered in San Francisco, Wells Fargo provides
banking, insurance, investments, mortgage, and consumer and commercial
finance through more than 9,000 locations, 12,500 ATMs, and the internet
(wellsfargo.com),
and has offices in 36 countries to support customers who conduct
business in the global economy. With more than 265,000 team members,
Wells Fargo serves one in three households in the United States. Wells
Fargo & Company was ranked No. 29 on Fortune’s 2014 rankings
of America’s largest corporations. Wells Fargo’s vision is to satisfy
all our customers’ financial needs and help them succeed financially.
Wells Fargo perspectives and stories are also available at blogs.wellsfargo.com
and at wellsfargo.com/stories.